Funds take flight after Saudi disclosure rule

Riyadh: Saudi Arabia's stock market continued its decline throughout the past week with the main index falling to less than 8,500 points amid the lowest trade recorded in two years.

The Saudi market sentiment has been negatively affected by declines in regional and international stock as well as growing tensions between Iran and a bloc of Western countries.

The market may also be heading for more sell-off because of the new rule to disclose names of investors holding stakes of five per cent or more.

Some speculative funds left the market as investors feared their holdings may become public information.

The new rule announced by Tadawul, the Saudi stock exchange, last week stipulates that the names of investors with stakes of five per cent or more should be published in the 124 listed firms on a daily basis from August 16.

While the measure moves Saudi Arabia closer to the transparency standards of international markets, it sent Saudi shares sharply lower.

The value of trades declined during the week to 30.7 billion Saudi riyals (about Dh30.7 billion).

The Saudi Arabian Mining Company, Maaden, which was listed on July 27 with a paid up capital of 9.25 billion riyals, gained the highest rate of trading stocks with 23 per cent followed by Sabic at nine per cent and Saudi Telecom with four per cent.

On Wednesday, the last day of the trading week, the Saudi stocks lost 51 points, representing 0.60 per cent.